9. The disputing parties may agree on the legal place of any arbitration under the arbitral rules applicable under paragraph 2(b) of this Article. If the disputing parties fail to reach an agreement, the tribunal shall determine the place in accordance with the applicable arbitral rules, provided that the place shall be in the territory of a State that is a party to the New York Convention.

10. A Contracting Party shall not assert as a defense, counter-claim, right of set-off or for any other reason, that indemnification or other compensation for all or part of the alleged damages has been received or will be received pursuant to an indemnity, guarantee or insurance contract.

11. The arbitral tribunal, in its award, shall set out its findings of law and fact, together with the reasons for its ruling and may, at the request of a party, provide the following forms of relief:

(a) A declaration that the Contracting Party has failed to comply with its obligations under this Agreement;

(b) Pecuniary compensation, which shall include interest from the time the loss or damage was incurred until the payment was or will be made;

(c) Restitution in kind in appropriate cases, provided that the Contracting Party may pay pecuniary compensation in lieu thereof where restitution in kind is not practicable in the good faith judgment of the responding Contracting Party; and

(d) With the agreement of the parties to the dispute, any other form of relief.

12. Arbitration awards shall be final and binding upon the parties to the dispute. Each Contracting Party shall provide for the enforcement of an award in its territory.

(6) Unless the Contracting Parties otherwise agree, the United Nations Commission on International Trade Law Rules on Transparency in Treaty-based Investor-State Arbitration (UN Doc A/CN.9/783) (the "UNCITRAL Transparency Rules") shall not apply to arbitrations initiated pursuant to paragraph 2(b)(iii) of Article 11. The Contracting Parties shall enter into consultations on the future application of the UNCITRAL Transparency Rules to arbitrations initiated pursuant to paragraph 2(b)(iii) of Article 11, upon request of a Contracting Party.

(7) The ad hoc Joint Committee shall be established by the request of the responding Contracting Party invoking the defense referred to in Article 16 and shall be composed of Governmental representatives designated by the two Contracting Parties.

Article 12. Application of other Rules

If the laws and regulations of either Contracting Party or obligations under international law existing at present or established hereafter between the Contracting Parties in addition to this Agreement contain provisions, whether general or specific, entitling investments by investors of the other Contracting Party to a treatment more favorable than is provided for by this Agreement, such provisions shall, to the extent they are more favorable, prevail over this Agreement.

Article 13. Application of the Agreement

1. This Agreement applies to existing investments at the date of the entry into force of this Agreement, as well as to investments made or acquired after that date.

2. This Agreement shall not apply to claims arising out of events which occurred, or to claims which had been settled, prior to its entry into force.

Article 14. Denial of Benefits

1. A Contracting Party may deny the benefits of this Agreement to an investor of the other Contracting Party that is an enterprise of that other Contracting Party, and to investments of that investor, if persons of a non-Contracting Party, directly or indirectly, own or control the enterprise, and the denying Contracting Party adopts or maintains measures with respect to the non-Contracting Party or a person of the non-Contracting Party that prohibit transactions with the enterprise or that would be violated or circumvented if the benefits of this Agreement were accorded to the enterprise or its investments.

2. A Contracting Party may deny the benefits of this Agreement to an investor of the other Contracting Party that is an enterprise of that other Contracting Party, and to investments of that investor, if the enterprise has no substantial business activities in the territory of that other Contracting Party.

Article 15. Interpretation of the Agreement

The Contracting Parties shall consult and issue interpretations with regard to any provision of this Agreement, upon the request of a Contracting Party, if a dispute between the Contracting Parties or between a Contracting Party and an investor of the other Contracting Party concerning the interpretation of this Agreement arises. The interpretations of this Agreement agreed between the Contracting Parties shall be binding on tribunals established under the Article 10 (Settlement of Disputes between Contracting Parties) and the Article 11 (Settlement of Investment Disputes between a Contracting Party and an Investor of the other Contracting Party).

Article 16. Exceptions on Financial Services

1. With respect to the supply of financial services in the territory of a Contracting Party by an investment, the Contracting Party shall not be prevented from adopting or maintaining measures for prudential reasons, including for the protection of investors, depositors, policy holders, or persons to whom a fiduciary duty is owed by a financial institution, or to ensure the integrity and stability of the financial system. Where such measures do not conform with the provisions of this Agreement, they shall not be used as a means of avoiding the Contracting Party's commitments or obligations under such provisions.

2. Nothing in this Agreement, with respect to the supply of financial services in the territory of a Contracting Party by an investment, applies to non-discriminatory measures of general application taken by any public entity in pursuit of monetary and related credit policies or exchange rate policies.

3. Notwithstanding Article 6 (Transfers), a Contracting Party may prevent or limit transfers by a financial institution to, or for the benefit of, an affiliate of or a person related to such institution or supplier, through the equitable, non-discriminatory, and good faith application of measures relating to maintenance of the safety, soundness, integrity, or financial responsibility of financial institutions. For greater certainty, this paragraph does not prejudice any other provision of this Agreement that may permit a Contracting Party to restrict transfers.

4. For greater certainty, nothing in this Agreement shall be construed to prevent a Contracting Party from adopting or enforcing measures necessary to secure compliance with laws or regulations that are not inconsistent with this Agreement, including those relating to the prevention of deceptive and fraudulent practices or to deal with the effects of a default on financial services contracts, subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between countries where like conditions prevail, or a disguised restriction on investment in financial institutions.

Article 17. Security Exception

Nothing in this Agreement shall be construed:

(a) To require a Contracting Party to furnish any information, the disclosure of which it considers contrary to its essential security interests;

(b) To prevent a Contracting Party from taking any actions which it considers necessary for the protection of its essential security interests; or

(c) To prevent a Contracting Party from taking any action in pursuance of its obligations under the United Nations Charter for the maintenance of international peace and security.

Article 18. Taxation

1. Except as provided in this Article, nothing in this Agreement shall impose obligations with respect to taxation measures.

2. Article 5 (Expropriation and Compensation) shall apply to all taxation measures, except that a claimant that asserts that a taxation measure involves an expropriation may submit a claim to arbitration under Article 10 (Settlement of Disputes between Contracting Parties) or Article 11 (Settlement of Investment Disputes between a Contracting Party and an Investor of the other Contracting Party) only if:

(a) The claimant has first referred to the competent tax authorities (8) of both Contracting Parties, in writing, the issue of whether that taxation measure involves an expropriation; and

(b) Within one hundred and eighty (180) days after the date of such referral, the competent tax authorities of both Contracting Parties fail to agree that the taxation measure is not an expropriation.

3. Nothing in this Agreement shall affect the rights and obligations of either Contracting Party under any tax convention. In the event of any inconsistency between this Agreement and any such convention, that convention shall prevail to the extent of the inconsistency. In the case of a tax convention between the Contracting Parties, the competent authorities under that convention shall have sole responsibility for determining whether any inconsistency exists between this Agreement and that convention.

(8) For the purposes of this Article, "competent tax authorities" means, for the Republic of Korea, Ministry of Strategy and Finance or National Tax Service; and for the Republic of Armenia, Ministry of Finance and State Revenue Committee.

Article 19. Entry Into Force, Duration and Termination

1. The Contracting Parties shall notify each other in writing of the completion of their internal legal procedures necessary for the entry into force of this Agreement. This Agreement shall enter into force thirty (30) days after the date of receipt of the later notification.

2. This Agreement shall remain in force for a period of ten (10) years. Either Contracting Party may give notice of termination of this Agreement not less than one (1) year before it is due to expire. Failing such notice, this Agreement shall continue in force for an indefinite period unless either Contracting Party notifies the other Contracting Party in writing one (1) year in advance of its intention to terminate this Agreement.

3. In respect of investments made prior to the termination of this Agreement, the provisions of Articles 1 to 18 of this Agreement shall remain in force for a further period of ten (10) years from the date of the termination.

4. The Agreement may be amended by mutual written consent of the Contracting Parties. Any amendment or termination of this Agreement shall be effected without prejudice to any rights or obligations accruing or incurred under this Agreement prior to the effective date of such amendment or termination.

Conclusion

IN WITNESS WHEREOF, the undersigned, duly authorized thereto by their respective Governments, have signed this Agreement.

DONE in duplicate at Yerevan, on the day of 19th October, 2018, in the Korean, Armenian and English languages, all texts being equally authentic. In case of any divergence of interpretation, the English text shall prevail.

FOR THE GOVERNMENT OF THE REPUBLIC OF KOREA

FOR THE GOVERNMENT OF THE REPUBLIC OF ARMENIA

Attachments

The Contracting Parties confirm their shared understanding that:

1. An action or a series of actions by a Contracting Party cannot constitute an expropriation unless it interferes with a tangible or intangible property right in an investment.

2. Article 5 (Expropriation and Compensation) addresses two situations. The first is direct expropriation, where an investment is nationalized or otherwise directly expropriated through the formal transfer of title or outright seizure.

3. The second situation addressed by Article 5 (Expropriation and Compensation) is indirect expropriation, where an action or a series of actions by a Contracting Party has an effect equivalent to direct expropriation without formal transfer of title or outright seizure.

(a) The determination of whether an action or a series of actions by a Contracting Party, in a specific fact situation, constitutes an indirect expropriation, requires a case-by-case, fact-based inquiry that considers all relevant factors relating to the investment, including:

(i) The economic impact of the government action, although the fact that an action or a series of actions by a Contracting Party has an adverse effect on the economic value of an investment, standing alone, does not establish that an indirect expropriation has occurred;

(ii) The extent to which the government action interferes with distinct, reasonable investment-backed expectations; (9) and

(iii) The character of the government action, including its objectives and context. Relevant considerations could include whether the government action imposes a special sacrifice on the particular investor or investment that exceeds what the investor or investment should be expected to endure for the public interest.

(b) Except in rare circumstances, such as, for example, when an action or a series of actions is extremely severe or disproportionate in light of its purpose or effect, non-discriminatory regulatory actions by a Contracting Party that are designed and applied to protect legitimate public welfare objectives, such as public health, safety, the environment, and real estate price stabilization (through, for example, measures to improve the housing conditions for low-income households), do not constitute indirect expropriations.(10)

4. The concept of indirect expropriation is not intended to impugn a governmental measure adopted in the exercise of legitimate regulatory authority by a Contracting Party which is otherwise consistent with other provisions of this Agreement.

(9) For greater certainty, whether an investor's investment-backed expectations are reasonable depends in part on the nature and extent of governmental regulation in the relevant sector. For example, an investor's expectations that regulations will not change are less likely to be reasonable in a heavily regulated sector than in a less heavily regulated sector.

(10) For greater certainty, the list of "legitimate public welfare objectives" in subparagraph (b) is not exhaustive.

The determination of whether a taxation measure, in a specific fact situation, constitutes an expropriation requires a case-by-case, fact-based inquiry that considers all relevant factors relating to the investment, including the factors listed in Annex I and the following considerations:

(a) The imposition of taxes does not generally constitute an expropriation. The mere introduction of a new taxation measure or the imposition of a taxation measure in more than one jurisdiction in respect of an investment generally does not in and of itself constitute an expropriation;

(b) A taxation measure that is consistent with internationally recognized tax policies, principles, and practices should not constitute an expropriation. In particular, a taxation measure aimed at preventing the avoidance or evasion of taxation measures generally does not constitute an expropriation;

(c) A taxation measure that is applied on a non-discriminatory basis, as opposed to a taxation measure that is targeted at investors of a particular nationality or at specific taxpayers, is less likely to constitute an expropriation; and

(d) A taxation measure generally does not constitute an expropriation if it was already in force when the investment was made and information about the measure was publicly available.